By Michael Silvio, Financial Poise
August 22, 2019
A Tax Reform Analysis
As the President’s third year winds down, and the nation turns its focus on the next election, it is interesting to reflect on where the original expectations meet with reality now that the Tax Cuts and Jobs Act is in full effect.
An Overview of the TCJA
The Tax Cuts and Jobs Act was signed into law in December of 2017. It maintained seven tax brackets for individuals, but only cut tax rates by a few percentage points for most tax brackets. In addition, individual taxpayers took notice of the limitations in permissible itemized tax deductions, including limitations for mortgage interest and home equity debt deductions. However, the act did double the standard deduction. The kicker: Individual tax rate changes, unlike corporation taxes, are temporary and revert to their original status after 2025.
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